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Superintendent of Insurance Neil D. Levin today announced that a new Public Service Announcement, informing New Yorkers of common misperceptions about purchasing insurance and advising citizens how to contact the Department, will be hitting the airwaves early next month.

"Insurance fraud costs New York’s consumers billions of dollars a year in the form of increased insurance premiums and higher prices for goods and services. Promoting public awareness will help educate consumers of these crimes and give consumers the chance to identify and prevent insurance fraud," said Levin. "The Department has met with over 100 District Attorneys and Assistant District Attorneys across the State and over 300 representatives from more than 100 insurance companies. We directed all insurers to file fraud prevention plans and we piloted an electronic fraud reporting system to track and review on-line submissions. Our efforts to protect New York State consumers from insurance fraud and higher rates are working—arrests are up 178% and convictions are up 145 % since 1995."

Expanding undercover operations and focusing on No-Fault auto insurance fraud are recent Frauds Bureau initiatives. Reported cases of no-fault fraud have skyrocketed from 2,800 in 1994 to 9,191 in 1999. In 1998 the Department saw an all time high of 9,659 cases reported. The Department has promulgated a fraud-fighting regulation in response to abuse and fraud in the no-fault arena and to maintain a stable rate environment. The regulation is also an important consumer protection. Regulation 68 is currently under review.

The Department’s website contains important consumer tips for identifying and preventing fraud including:

  • Make sure your insurer and your agent or broker are licensed. The Department’s Licensing Bureau can provide this information.
  • Don’t pay insurance premiums in cash. Your cancelled check or money order stub will be your proof of payment.
  • Review your "Explanation of Medical Benefits" statement carefully to be sure you received all services listed.
  • Be suspicious if, at the scene of an accident, a stranger recommends a particular doctor, lawyer or medical facility.
  • Never sign a blank insurance claim form.
  • You should receive a written policy within a reasonable period after purchase. Your policy ensures that the agent forwarded your premium payment to the insurer.
  • Be wary if the price of insurance coverage offered by one insurer is substantially lower than rates from other companies. Remember, if it sounds too good to be true, it probably is.

The Department’s Insurance Frauds Bureau, created in 1981, is headquartered in New York City and has six other offices across the State. Arrests for insurance fraud have jumped from 140 in 1995 to 390 in 1999. Since January 1, 2000 an additional 377 arrests have been made. To report a possible insurance fraud, contact the Department Frauds Hotline at 1-888-FRAUDNY or visit the Department’s website at

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